Operational bill explained

Operational bills are a tendering document for estimating costs prepared by architects that describes a construction project in terms of the operations (which include labour and plant) needed to build it. This form of document contrasts with that of bills of quantities in which such tendering and estimation is limited to the materials in the completed work. Operational bills have the advantages of enhancing communication between design and production, enabling realistic tender pricing, and making the preparation of critical-path analysis easy for the contractor.^{[1] [2] [3] [4]} Operational bills were proposed and developed by Edward Skoyles at Building Research Establishment in the 1960s.^{[1] [2]} Priced-activity schedules of the New Engineering Contract are a modern related form, prepared by the contractor.^[5]

Creation

An operation is defined as a piece of construction work which can be carried out by a gang of operatives without interruption from another gang. A procedure diagram is provided that shows the relationship of operations to each other and so which are done in sequence and which are done in parallel. This allows a critical-path analysis to be quickly created by the contractor. There are two sections: the first deals with site operations in terms of schedules of materials, labour and plant requirements, and the second, any work prefabricated adjacent or off site. At the end of the bill, management and plant resources are given so they are included.^{[1] [2] [6]}

History

After operational bills were proposed, a second half-way house version with bills of quantities was suggested initially called "activity bills", but then as "Bills of quantities (operations)". In this, the operations are described in terms of the rules of the standard method of measurement rather than labour and materials.^{[5] [7] [8] [9] [10]} A further development was the use of the principles of operational bills in the priced-activity schedules of the New Engineering Contract.^[5]

Advantages and disadvantages

Advantages

• Separates the costs of labour, materials and plant thus enabling cost control.^[11]
• Increases the accuracy of estimating.^{[12] [13]}
• Costs can be related to factors that directly determine them such as overall plant usage.^[11]
• Allows the reuse of information created in estimating for project management.^[11]
• Enables better estimation of variation in works.^[11]

Disadvantages

• Bulky and costly to produce so increasing the work of the contractor’s estimators.^{[5] [13]}
• Radically changes the estimating process.^[5]
• Does not fit in with current contracts in regard to work variation.^[13]
• It needs computers to allow rapid manipulation of the data: this did not exist when it was originally proposed.^[14]
• The design team responsible for creating the operational bill need not be "very familiar with the buildability issues as they affect the construction process".^[14]

See also

• • Bill of materials Bill of quantities
• Construction bidding
• Design-bid-build tender phase

Notes and References

1. Skoyles, E. R. (1966) Examples from operational bills
2. Skoyles, E. R. (1967) Preparation of an operational bill. Building Research Station
3. Shanley LF. (1970). Report on pilot project on operational bills. An Foras Forbartha (Irish National Institute for Physical Planning and Construction Research)
4. England Symposium on Operational Bills (1967). "Symposium on Operational Bills discussion. Report on a Symposium on Operational Bills held at the Building Research Station, 8th March."
5. Potts, K. (2008). Construction Cost Management: Learning from Case Studies, Routledge.
6. Royal Institute of Surveyors (Republic of Ireland Branch) (1970). The bill of quantities and the operational bill: Seminar, Dublin, March. An Foras Forbartha (Irish National Institute for Physical Planning and Construction Research)
7. Skoyles, ER. (1970). Bills of quantities, or the operational bill? Architects' Journal (28 January) 233-240.
8. Skoyles, ER. (1981). Production orientated tendering: a resume and re-examination for the early eighties of the issues involved. Quantity surveyor, 37, (6) 110-113.
9. Skoyles, ER. (1968). Introducing bills of quantities : (Operational format). Building Research Station.
10. Skoyles ER. (1969).Examples from bills of quantities (Operational format). Building Research Station.
11. Ashworth, A. (2002). Pre-contract studies: development economics, tendering and estimating. Edition: 2. Wiley-Blackwell. p.332.
12. Lal H. (2002). Quantifying and Managing Disruption Claims. Thomas Telford. .
13. Dmaidi, N. (2003). The State of the Art in Integration of Cost and Time Models . An-Najah University Journal of Research. 17(1). 99-122. pp. 108-109
14. Jaggar D. Ross A. Smith J. Love P. (2002). Building Design Cost Management. Edition: 2. Wiley-Blackwell. pp147-148